ARTIFICIAL INTELLIGENCE

AI-driven marketing campaigns are improving performance – Yum Brands

By our African Marketing Confederation News Team | 2024

Parent company of fast-food brands such as KFC and Pizza Hut reports ‘significant increases in consumer engagement’ using AI tools.

Yum Brands, the global parent company of the likes of KFC and Pizza Hut, says it has improved its marketing performance due to several new artificial intelligence initiatives introduced in the key North American market.

“This quarter, we successfully launched personalised AI-driven marketing campaigns that, relative to traditional digital marketing campaigns, generated significant increases in consumer engagement, leading to increased purchases and a reduction in consumer churn,” said Chris Turner, the company’s Chief Financial Officer.

He was speaking during a discussion with market analysts about the Yum Brands’ third-quarter earnings results which were released last week. The results covered the quarter ended 30 September 2024.

Photo: Parviz Hajizada from Pexels

“Turner declined to break out specific metrics stemming from Yum’s AI-powered marketing initiatives but offered additional colour into how the fast-food giant’s ‘AI factory’ operates,” reports the industry news website Marketing Dive.

“For example, Taco Bell (a Mexican-inspired QSR brand that does not operate in Africa) can accrue data from points of sale and digital menu boards in stores, as well as leverage the chain’s popular loyalty programme and app. Linking these sources of intel together and enhancing them with AI allows for more personalised promotions and a refined picture of the customer for other marketing purposes.”

AI strategies ‘broadly and easily scalable’

According to Turner, AI strategies will continue to be rolled out across other brands and territories within the Yum stable, and that these strategies will be “broadly and easily scalable”.

Taco Bell, which returned strong third-quarter earnings for the company, is also in the process of rollout out AI-based voice technology at hundreds of its drive-thrus in the United States, with Turner saying that consumer response has been “very positive” to date.

This runs counter to the experience of some other brands which have experimented with AI at drive-thrus. For example, in June 2024 McDonald’s made a surprise announcement that it was ending a trial of an AI-powered drive-thru ordering system that had been running since 2021.

According to US media reports at the time, no specific reason was given for ending the trial, but there were various viral videos and media coverage documenting when artificial intelligence drive-thru systems got orders wrong.

You can watch a TikTok video here, called ‘Fighting with McDonald’s robot’.

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